George Bowens v. State Farm Mutual Automobile Insurance Company

Summary

The Supreme Court of Maryland held that the District Court had subject matter jurisdiction over George Bowens’s breach of contract claim against State Farm for $20,000 in underinsured motorist benefits. The court concluded that the “debt or damages claimed” under the District Court’s jurisdictional statute is measured by the amount sought from the insurer in the pending action, not by the insured’s total underlying tort damages before subtracting amounts already paid by the tortfeasor’s insurer. The court reversed the circuit court’s judgment and remanded with instructions to remand the case to the District Court.

Holdings

1. The phrase “debt or damages claimed” in CJP § 4-401(1) is measured by the amount the plaintiff seeks from the defendant in the pending action, not by amounts previously paid by the tortfeasor’s liability insurer or by the plaintiff’s gross underlying tort damages.
2. When a UIM insurer consents to the tortfeasor’s settlement under Ins. § 19-511(c)(1), the insured may pursue a residual first-party contractual claim in the District Court if the residual claim does not exceed $30,000; the insurer may not compel litigation in circuit court merely because proof of total underlying damages may exceed $30,000.

Questions Presented

1. Whether the phrase “debt or damages claimed” in CJP § 4-401(1) for purposes of District Court jurisdiction is measured by the plaintiff’s total underlying tort damages or by the amount the plaintiff seeks from the defendant in the pending action.
2. Whether an insured’s residual UIM breach-of-contract claim for $20,000 falls within the District Court’s $30,000 jurisdictional limit after the insurer consents to the tortfeasor’s $30,000 settlement and waives subrogation.

Disposition

reversed_and_remanded